Globally accepted indicator limited in scope and poor in representing an economy's carbon performance

China is the world's second largest energy consumer after the United States, and has one of the world's fastest growing energy sectors. While energy fuels economic growth and poverty reduction, inefficient energy use depletes resources at a faster rate and severely damages the environment. It is hard to reconcile continued growth of energy consumption while protecting the environment.

The Chinese government has made some strides in improving energy efficiency and reducing carbon dioxide (CO2) emissions. The 11th Five-Year Plan (2006-2010) mandates a 20 percent reduction in energy intensity (the amount of energy consumed per unit of GDP) by 2010. The order applies to all provinces and municipalities.